Vermont Lemon Law: Complete Guide for 2026

Last verified: February 2026

Key Points

Primary Law: Vermont Lemon Law (9 V.S.A. §§ 4170-4181)
Coverage: Passenger motor vehicles under 12,000 lbs GVW, excluding snowmobiles, motorcycles, mopeds, and living portions of RVs
Presumption: 3+ repair attempts for same defect OR 30+ calendar days out of service during warranty period
Remedies: Replacement vehicle or full refund at consumer’s choice, plus incidental and consequential damages
State Arbitration: Vermont Motor Vehicle Arbitration Board provides free arbitration
Used Vehicles: Covered if first repair occurs within manufacturer’s express warranty

Quick Penalties Overview

Violation Type	Consumer Remedy	Additional Damages
Failure to repair substantial defect	Replacement or refund	Incidental and consequential damages
Violation of lemon law	Unfair and deceptive practice claim	Consumer protection remedies available
Failure to provide repair orders	Required written documentation	Evidence for arbitration claim

📑 Table of Contents (click to expand)

The Vermont Lemon Law
What Vehicles Are Covered
Vermont’s Lemon Law Presumption
Consumer Remedies: Refund vs. Replacement
How to File a Lemon Law Claim
Vermont Motor Vehicle Arbitration Board
Manufacturer Defenses
Used Vehicle Protections
Leased Vehicle Coverage
Frequently Asked Questions
Resources and Legal Help

The Vermont Lemon Law

Vermont’s lemon law, codified at 9 V.S.A. §§ 4170-4181, is one of the more consumer-friendly lemon laws in the United States. Established in 1984, the Motor Vehicle Arbitration program provides consumers with a free forum to resolve warranty problems through the Vermont Motor Vehicle Arbitration Board.

The Vermont Legislature declared that manufacturers should be required to provide a refund or replacement vehicle “in as expeditious a manner as possible” whenever they are unable to make the vehicle conform to its warranty. Importantly, Vermont’s lemon law explicitly states that new motor vehicle dealers and used motor vehicle dealers cannot be sued under this chapter, placing responsibility squarely on manufacturers.

One of Vermont’s notable features is that used vehicles may be covered if the first repair attempt occurred within the manufacturer’s express warranty period and other eligibility requirements are met. This provides broader protection than many state lemon laws that cover only new vehicles.

What Vehicles Are Covered

Vermont’s lemon law defines coverage based on the vehicle type and warranty status.

Covered Vehicle Types

Passenger motor vehicles: Purchased, leased, or registered in Vermont
Trucks: With gross vehicle weight rating of 12,000 pounds or less
SUVs and crossovers: Under 12,000 pounds GVWR
Vans: Passenger and cargo vans under weight limit

Vehicles Not Covered

Tractors
Motorized highway building equipment
Road-making appliances
Snowmobiles
Motorcycles
Motor-driven cycles
Mopeds
Living portions of recreation vehicles
Trucks with gross vehicle weight rating over 12,000 pounds

What is a “New Motor Vehicle”?

Under Vermont law, a “new motor vehicle” means a passenger motor vehicle that is still under the manufacturer’s express warranty. This broad definition means that even a used vehicle may qualify if it remains under the original warranty.

Who Qualifies as a Consumer

A “consumer” under Vermont’s lemon law includes:

The purchaser of a new motor vehicle (not for resale)
The lessee of a new motor vehicle (not for sublease, and not previously leased)
Any person to whom the vehicle is transferred during the warranty period
Any person entitled by warranty terms to enforce warranty obligations

Excluded from “consumer” status are:

Governmental entities
Business or commercial enterprises that register or lease three or more motor vehicles

Vermont’s Lemon Law Presumption

Under 9 V.S.A. § 4172(g), Vermont law creates a presumption that a reasonable number of repair attempts have been undertaken if certain conditions are met.

The Lemon Law Presumption Applies When:

Condition	Requirement	Details
Repair Attempts (Same Problem)	3 or more attempts	Same nonconformity as identified in written repair orders, with at least the first attempt during warranty term
Days Out of Service	30 or more calendar days	Cumulative total during term of express warranty

Important Repair Documentation Requirements

For repair attempts to count toward the presumption:

Each attempt must be evidenced by a written examination or repair order
The presumption applies only to three repair attempts by the same agent or authorized dealer
Unless the consumer shows good cause for taking the vehicle to a different dealer

What Qualifies as “Substantially Impairs”?

The defect must substantially impair the use, market value, or safety of the motor vehicle. Minor or cosmetic issues typically do not qualify.

Extension of Time Periods

The warranty term and 30-day period are extended by any time during which repair services were not available due to:

War
Invasion
Strike
Fire
Flood
Other natural disaster

If an extension is needed due to these conditions, the manufacturer must provide a free vehicle for the consumer’s use during the out-of-service period.

Consumer Remedies: Refund vs. Replacement

When a vehicle qualifies as a lemon under Vermont law, the consumer has the choice of remedy within 30 days of the Arbitration Board’s order.

Option 1: Replacement Vehicle

The manufacturer must replace the defective vehicle with:

A new motor vehicle from the same manufacturer (if available)
Comparable worth to the same make and model
All options and accessories
Appropriate adjustments for model year differences

Option 2: Full Refund (Buyback)

The manufacturer must accept return of the vehicle and refund:

Full purchase price: As indicated in the purchase contract
All credits and allowances: For any trade-in or down payment
Finance charges and credit charges
Registration fees
Similar charges
Incidental and consequential damages: Where applicable

Reasonable Allowance for Use

A reasonable allowance for use may be deducted. Under Vermont law, this is calculated using a specific formula:

Allowance = (Full Purchase Price x Miles Before First Repair) / 100,000

The allowance is based on miles driven prior to the first repair attempt, not the total miles on the vehicle.

Sales Tax Refund

If the manufacturer refunds the purchase price, Vermont will also refund the motor vehicle purchase and use tax to the consumer in a proportionate amount. The consumer must file a claim with the Commissioner of Motor Vehicles within 90 days of the Board’s order.

How to File a Lemon Law Claim in Vermont

Vermont provides a free state-administered arbitration process for lemon law claims.

Step 1: Document Everything

Keep all repair orders showing dates, mileage, and work performed
Obtain written repair orders for each visit (dealers must provide these)
Note the specific symptoms and problems
Save all correspondence with dealer and manufacturer
Take photos or videos of defects

Step 2: Report and Allow Repairs

Report the nonconformity to the manufacturer, its agent, or authorized dealer during the warranty term. Allow a reasonable number of repair attempts, typically at least three for the same problem.

Step 3: Final Repair Attempt by Manufacturer

Before requesting arbitration, you may need to allow the manufacturer a final opportunity to repair the vehicle. The manufacturer must disclose procedures for requesting a final repair attempt in the warranty or owner’s manual.

Step 4: Request Arbitration

File a Demand for Arbitration with the Vermont Department of Motor Vehicles Lemon Law Administration:

Complete the arbitration request form
Include copies of repair orders and documentation
Describe the nonconformity and repair history
There is no fee for the arbitration process

Step 5: Arbitration Hearing

Hearings are typically held monthly. Cases may be resolved by settlement, acceptance of a final repair attempt, administrative dismissal, or other disposition before reaching a hearing.

Vermont Motor Vehicle Arbitration Board

The Vermont Motor Vehicle Arbitration Board is established under 9 V.S.A. § 4174 to hear and decide lemon law claims.

Board Composition

The Board includes:

One member and one alternate who are new car dealers in Vermont
One member and one alternate who are active automobile technicians
Three members and one alternate who have no direct involvement in the design, manufacture, distribution, sales, or service of motor vehicles or their parts

Hearing Process

Hearings are typically less formal than court proceedings
You may represent yourself or have an attorney
Present your evidence and testimony
The manufacturer will present its defense
The Board issues a written decision

Possible Outcomes

Consumer prevails: Board orders replacement or refund
Manufacturer prevails: Claim is denied
Settlement: Parties may reach agreement before decision

Appeals

Under 9 V.S.A. § 4176, either party may appeal the Board’s decision to the appropriate court.

Manufacturer Defenses

Manufacturers may raise affirmative defenses to avoid lemon law liability.

Common Manufacturer Defenses

Defense	Manufacturer’s Argument	Consumer’s Counter
No substantial impairment	Defect does not substantially impair use, value, or safety	Document how defect affects daily use, resale value, or safety
Consumer abuse or neglect	Nonconformity resulted from misuse	Provide maintenance records and evidence of proper care
Unauthorized modifications	Aftermarket parts caused the problem	Show defect existed before modification or is unrelated
Different dealers without cause	Repair attempts were at different dealers without good cause	Demonstrate good cause for using different dealers

Dealer Liability Protection

Vermont’s lemon law explicitly states that new motor vehicle dealers and used motor vehicle dealers cannot be sued under this chapter. Claims must be directed at the manufacturer.

Used Vehicle Protections

Vermont provides broader used vehicle coverage than many states.

Used Vehicle Lemon Law Coverage

Used vehicles are covered under Vermont’s lemon law if:

The first repair occurred within the manufacturer’s express warranty
Other eligibility requirements are met
The vehicle still qualifies as a “new motor vehicle” (under manufacturer’s warranty)

Key Considerations for Used Vehicle Buyers

Check remaining warranty coverage before purchase
Request repair history documentation
Verify the vehicle has not been previously returned as a lemon

Additional Used Vehicle Protections

Beyond the lemon law, Vermont used vehicle buyers may have recourse through:

Federal Magnuson-Moss Warranty Act: For vehicles with unexpired warranties
Vermont Consumer Protection Act (9 V.S.A. Chapter 63): For unfair and deceptive practices
Common law warranty claims: Breach of express or implied warranty

Leased Vehicle Coverage

Vermont’s lemon law provides specific protections for lessees under 9 V.S.A. § 4172(i).

Lease Requirements

To be covered, the lease must be:

A written lease agreement
For a term of two or more years
Vehicle must not have been previously leased by another person

Replacement for Leased Vehicles

If the lessee elects replacement, a collateral change with appropriate adjustments for model year difference or excess mileage is incorporated into an amended lease agreement.

Refund Calculation for Leased Vehicles

If refund is chosen:

Lessee receives: Aggregate deposit and rental payments previously paid, plus incidental and consequential damages, minus reasonable use allowance and allocated purchase/use tax
Lessor receives: Actual purchase cost, freight, accessories, fees to obtain lease, and 5% of actual purchase cost (in lieu of early termination costs)

Lease Termination

Upon a Board decision in favor of the lessee:

The lease agreement and all contractual obligations are terminated
The lessee is not liable for any further costs to the manufacturer or lessor
The motor vehicle lessor must release title to the manufacturer upon payment

Frequently Asked Questions

How many repair attempts does Vermont require before a vehicle is considered a lemon?

Vermont’s lemon law presumption requires three or more repair attempts for the same nonconformity (with at least the first during the warranty term), or 30 or more calendar days out of service for repairs during the warranty. The repair attempts must be documented in written repair orders.

Does Vermont’s lemon law cover used cars?

Yes, Vermont has broader used vehicle coverage than many states. Used vehicles may be covered if the first repair occurred within the manufacturer’s express warranty and other eligibility requirements are met. A vehicle is considered a “new motor vehicle” under Vermont law as long as it remains under the manufacturer’s express warranty.

Is there a fee to use the Vermont Motor Vehicle Arbitration Board?

No, the arbitration process through the Vermont Motor Vehicle Arbitration Board is free to consumers. This makes Vermont’s lemon law particularly accessible.

Can I sue a dealer under Vermont’s lemon law?

No, Vermont’s lemon law explicitly states that new motor vehicle dealers and used motor vehicle dealers cannot be sued under this chapter. Claims must be directed at the manufacturer.

What is the reasonable use formula in Vermont?

Vermont calculates the reasonable allowance for use by multiplying the full purchase price by a fraction with 100,000 as the denominator and the miles driven before the first repair attempt as the numerator. This formula caps the deduction based on early mileage.

Does Vermont’s lemon law cover motorcycles?

No, motorcycles, motor-driven cycles, and mopeds are specifically excluded from Vermont’s lemon law coverage.

How long do I have to file a claim after the Arbitration Board’s decision?

Consumers have 30 days from the effective date of the Board’s order to choose between a replacement vehicle or a refund. If you want a refund of Vermont sales tax, you must file a claim with the Commissioner of Motor Vehicles within 90 days of the order.